News Details

Joint legislative hearing held on cannabis regulation and taxation proposal

9/7/2017

During the week, the Senate and House Appropriations committees held a joint hearing on Senate Bill 316, a proposal to legalize the taxation and regulation of recreational cannabis. The hearing focused on the issue of public safety and the potential ramifications of legalization and sales of recreational marijuana in the communities.

Under the proposed legislation, adults 21 and older could legally possess, grow and purchase specified amounts of cannabis. It would also give the State of Illinois the authority to license and regulate businesses that wish to cultivate and sell marijuana to adults, and set the health and safety regulations. Customers would incur tax on cannabis purchases at a rate of $50 per ounce at the wholesale level. Retail sales would be subject to the state’s standard 6.25 percent state sales tax.

Various law enforcement officials expressed concern for a potential increase in substance abuse as a result of legalizing marijuana. The statute, as written, proposes those convicted of selling marijuana to a minor would incur a civil fine; however, it would be much lower than the fine issued for selling alcohol to a minor. As a result, officials believe the lessor punishment would contribute to an increase in the underage use of marijuana, as well as an increase the number of marijuana dealers. Opponents also pointed to Colorado’s increased drug crime rates, and cautioned that the loss of one substance on the black market can lead to criminal investment in a different drug market. They also predicted a potential rise in drug sales in neighboring states that have not legalized marijuana.

Additionally, if Illinois were to implement Senate Bill 316, cannabis still remains a controlled substance under federal law, in which case, operations involving the taxation and regulation of cannabis could be shut down by the federal government at any point.

Senate Bill 316 is in the Senate Assignments Committee and potentially up for review during the 2018 Spring Legislative Session.